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Article

Open Access

Currency Systems and Their Role in Entering and Leaving the Economic Crisis

Author(s)

Jakub Jedlinský

Full-Text PDF Download XML 1478 Views

DOI:10.17265/1537-1506/2015.04.001

Affiliation(s)

Jakub Jedlinský, Mgr., Ing., Department of World Economy, University of Economics in Prague, Prague, the Czech Republic.

ABSTRACT

The paper focuses on a comparison of two contrasting approaches: having a single universal currency in a given fiscal area or supporting a concurrent presence of more competing currencies of different types. A systemic analysis (based on studying both conventional and unorthodox literature) of the modern monetary system points out that the very type of money that is used suffers internal errors that make a crisis inevitable. The indebtedness is systemic and unavoidable in a currency that is issued as a liability. Parallel currencies are proposed as a general solution. A specific solution, including a redefined national currency, is offered too, with an outline of its possible experimental verification. Such a system could help to prevent the next economic crisis, mitigate it, or at least facilitate its leaving. The paper also deals with criticism that is held against the idea of concurrent currencies.

KEYWORDS

redefinition of money, Gresham’s law, Tinbergen’s rule, economic crisis

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